Question 1

Statement I: The U.S. and nearly all other industrial nations were on the gold standard until 1934. Statement II: The gold standard may be termed "a self-correcting mechanism."

Accepted Answer

A)  Statement I is true and statement II is false.
B)  Statement II is true and statement I is false.
C)  Both statements are true.
D)  Both statements are false.E) A) and B)
F) A) and C)

Question 2

Over the last decade, foreigners have been exercising

Accepted Answer

A)  a declining influence over interest rates in the United States.
B)  an increasing influence over interest rates in the United States.
C)  about the same influence over interest rates in the United States.D) A) and B)
E) A) and C)

Question 3

Statement I: Since 1985, for the first time in our history, we have run up huge international debt. Statement II: To finance our international consumer spending binge we have been selling off pieces of America.

Accepted Answer

A)  Statement I is true and statement II is false.
B)  Statement II is true and statement I is false.
C)  Both statements are true.
D)  Both statements are false.E) All of the above
F) None of the above

Question 4

Under the gold standard, a country with a negative balance of trade would experience

Accepted Answer

A)  an inflow of gold and higher prices.
B)  an inflow of gold and lower prices.
C)  an outflow of gold and higher prices.
D)  an outflow of gold and lower prices.E) None of the above
F) A) and B)

Question 5

Which statement is true?

Accepted Answer

A)  The U.S.is both the world's leading creditor nation and the leading debtor nation.
B)  The U.S.is neither the world's leading creditor nation nor the world's leading debtor nation.
C)  The U.S.is the world's leading creditor nation and not the world's leading debtor nation.
D)  The U.S.is the world's leading debtor nation and not the world's leading creditor nation.E) None of the above
F) A) and B)

Question 6

Statement I: Our balance of trade is part of our current account balance. Statement II: Our balance of payments is part of our balance of trade.

Accepted Answer

A)  Statement I is true and statement II is false.
B)  Statement II is true and statement I is false.
C)  Both statements are true.
D)  Both statements are false.E) A) and B)
F) None of the above

Question 7

The rate at which two currencies trade for each other is called the

Accepted Answer

A)  exchange rate.
B)  price.
C)  cost.
D)  revenue.
E)  profit.F) None of the above
G) A) and B)

Question 8

If a dollar is initially valued at 10 Swiss francs and its value changes to 12 Swiss francs, then the value of a Swiss franc (in terms of dollars)  has

Accepted Answer

A)  increased only if the demand for Swiss francs has increased.
B)  remained the same.
C)  increased.
D)  decreased.
E)  changed in a manner that cannot be determined without additional information concerning the demand for and supply of Swiss francs.F) B) and C)
G) C) and D)

Question 9

The summary of the flows of goods, services, assets, and currency in and out of a country in a particular year is

Accepted Answer

A)  the balance of income statement.
B)  the balance of payments.
C)  the balance of trade.
D)  the trade deficit.
E)  the capital account.F) All of the above
G) A) and E)

Question 10

The summary of the flows of goods, services, assets, and currency in and out of a country in a particular year is the _______________________.

Accepted Answer

The answer of The summary of the flows of goods,...

Question 11

Our current account balance in 2009 was a

Accepted Answer

A)  surplus of about $220 billion.
B)  surplus of about $420 billion.
C)  deficit of about $220 billion.
D)  deficit of about $420 billion.E) B) and C)
F) A) and C) D

Question 12

The exchange rate between the dollar and the Swiss franc is $1 = 8 francs, and the price of a Swiss army knife is $5. If the exchange rate changes to $1 = 4 francs, the dollar price of the Swiss army knife ____ to _______.

Accepted Answer

A)  falls; $2.50
B)  rises; $10
C)  rises; $20
D)  does not changeE) B) and D)
F) C) and D)

Question 13

If 1 U.S. dollar exchanges for 0.9 Canadian dollars, how much would it cost in U.S. dollars and cents to purchase a Canadian hockey jersey priced at 45 Canadian dollars?

Accepted Answer

The answer of If 1 U.S. dollar exchanges for 0.9...

Question 14

If the exchange rate between the U.S. dollar and the Japanese yen is $1 = 200 yen, then the dollar price of yen is

Accepted Answer

A)  $.005.
B)  $.05.
C)  $.50.
D)  $5.E) A) and C)
F) A) and D) A

Question 15

When a currency depreciates relative to other currencies as a result of government action,

Accepted Answer

A)  it has appreciated.
B)  it has been devalued.
C)  it has been debased.
D)  it has become worthless.
E)  it has been subject to runaway inflation.F) D) and E)
G) A) and B) B

Question 16

Statement I: Strict adherence to the gold standard would render monetary policy utterly ineffective. Statement II: We were on the gold standard until 1987.

Accepted Answer

A)  Statement I is true and statement II is false.
B)  Statement II is true and statement I is false.
C)  Both statements are true.
D)  Both statements are false.E) All of the above
F) A) and C)

Question 17

Statement I. The entire flow of U.S. dollars and foreign currencies into and out of the country constitutes the balance of payments. Statement II. The balance of payments is part of the balance of trade.

Accepted Answer

A)  Statement I is true and statement II is false.
B)  Statement II is true and statement I is false.
C)  Both statements are true.
D)  Both statements are false.E) A) and B)
F) All of the above

Question 18

Drug trafficking leads to

Accepted Answer

A)  a net outflow of money from the United States.
B)  a net inflow of money into the United States.
C)  no net outflow or net inflow.D) None of the above
E) A) and B)

Question 19

Each of the following is a requirement of a gold standard except

Accepted Answer

A)  a nation defines its currency in terms of gold.
B)  a nation must maintain a fixed ratio between its gold stock and its money supply.
C)  a nation must maintain a constant average price level.
D)  there must be no barriers to the free flow of gold into and out of the country.E) B) and C)
F) All of the above

Question 20

If 1 U.S. dollar exchanges for 46.94 Indian rupees, how much would it cost in rupees to purchase a copy of Time Magazine priced at $2.50?

Accepted Answer

2.50 x 46....

Exam 20: International Finance

Statement I: The U.S. and nearly all other industrial nations were on the gold standard until 1934. Statement II: The gold standard may be termed "a self-correcting mechanism."

Correct AnswerverifiedShow Answer

Over the last decade, foreigners have been exercising

Correct AnswerverifiedShow Answer

Statement I: Since 1985, for the first time in our history, we have run up huge international debt. Statement II: To finance our international consumer spending binge we have been selling off pieces of America.

Correct AnswerverifiedShow Answer

Under the gold standard, a country with a negative balance of trade would experience

Correct AnswerverifiedShow Answer

Which statement is true?

Correct AnswerverifiedShow Answer

Statement I: Our balance of trade is part of our current account balance. Statement II: Our balance of payments is part of our balance of trade.

Correct AnswerverifiedShow Answer

The rate at which two currencies trade for each other is called the

Correct AnswerverifiedShow Answer

If a dollar is initially valued at 10 Swiss francs and its value changes to 12 Swiss francs, then the value of a Swiss franc (in terms of dollars) has

Correct AnswerverifiedShow Answer

The summary of the flows of goods, services, assets, and currency in and out of a country in a particular year is

Correct AnswerverifiedShow Answer

The summary of the flows of goods, services, assets, and currency in and out of a country in a particular year is the _______________________.

Correct AnswerverifiedShow Answer

Our current account balance in 2009 was a

Correct AnswerverifiedD

The exchange rate between the dollar and the Swiss franc is $1 = 8 francs, and the price of a Swiss army knife is $5. If the exchange rate changes to $1 = 4 francs, the dollar price of the Swiss army knife ____ to _______.

Correct AnswerverifiedShow Answer

If 1 U.S. dollar exchanges for 0.9 Canadian dollars, how much would it cost in U.S. dollars and cents to purchase a Canadian hockey jersey priced at 45 Canadian dollars?

Correct AnswerverifiedShow Answer

If the exchange rate between the U.S. dollar and the Japanese yen is $1 = 200 yen, then the dollar price of yen is

Correct AnswerverifiedA

When a currency depreciates relative to other currencies as a result of government action,

Correct AnswerverifiedB

Statement I: Strict adherence to the gold standard would render monetary policy utterly ineffective. Statement II: We were on the gold standard until 1987.

Correct AnswerverifiedShow Answer

Statement I. The entire flow of U.S. dollars and foreign currencies into and out of the country constitutes the balance of payments. Statement II. The balance of payments is part of the balance of trade.

Correct AnswerverifiedShow Answer

Drug trafficking leads to

Correct AnswerverifiedShow Answer

Each of the following is a requirement of a gold standard except

Correct AnswerverifiedShow Answer

If 1 U.S. dollar exchanges for 46.94 Indian rupees, how much would it cost in rupees to purchase a copy of Time Magazine priced at $2.50?

Correct Answerverified2.50 x 46....View AnswerShow Answer

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D

The exchange rate between the dollar and the Swiss franc is $1 = 8 francs, and the price of a Swiss army knife is $5. If the exchange rate changes to $1 = 4 francs, the dollar price of the Swiss army knife to ___.

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A

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B

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2.50 x 46....
View Answer